Amendments to Regulations on Dividend Declaration and Interest Payments on Tier 1 Capital Instruments

Corrected copy BANGKo SENrne,L NG} PIT-IpIruag OFFICE OF THE GOVERNOR ctRcutAR No.8S8 Series of 2015 Subject: Amendments to Regulations on Dividend Declaration and Interest Payments on Tier l Capital Instruments Pursuant to Monetary Board Resolution No. 1516 dated L7 september 2015, approving the amendments to regulations on dividend declaration, the provisions of the Manual of Regulations for Banks (MORB) and Manual of Regulations for Non-Bank Financial Institutions (MORNBFI) are hereby amended: " section 1. The following sections/subsections of the MoRB are hereby amended as follows: "Sec. X136 Dividends. The following rules.and regulations shall govern the declaration of dividends on shares of stock, regardless of feature, as well as interest payments on unsecured subordinated debt which meet requirements of Additional Tier 1 or Hybrid Tier 1 capital the qualification as defined under existing risk-based capital adequacy framework. "Pursuant to section 57 of R.A. No. 87gI, no bank shall declare dividends greater than its accumulated net profits then on hand, deducting therefrom its losses and bad debts. Neither shall the bank declare dividends if, at the time of declaration, it has not complied with the provisions of Subsec. XI36.2." "5 x136.1 Definitions. For purposes of this Section, the following definitions shall apply: "xxx" "s x136.2 Requirements on the declaration of dividends. At the time of declaration, banks shall have complied with the followin!: "a. clearing account with the Bangko sentral is not overdrawn; "b. Liquidity floor requirement for government funds; "c' Minimum capitalization requirement and risk-based capitat ratios as provided under applicable and existing capital adequacy framework; "d. Capital conservation buffer requirement as defined in Appendix 63b, part lll, for universal and commercial banks (u/KBs) and their subsidiary banks and quasi- banks (Qes1; A. Mabini 5t., Malate 1004 Manira, philippines r {632} 708-7701 . www.bsp.gov.ph o [email protected]

"e. Higher loss absorbency requirement, phased-in starting 1 January 2017 with full implementation by 1 January zOLg, in accordance with Domestic Systemically lmportant Banks (DSlBs) Framework as provided under Circular No. 856 dated 29 October 2OL4, for U/KBs and their subsidiary banks and eBs that are identified as DSIBs; and 'f.Has not committed any unsafe or unsound banking practice as defined under existing regulations and/or major acts or omissionsl as may be determined.by the Bangko Sentral to be ground for suspension of'dividend distribution, unless this has been addressed by the bank as confirmed by the Monetary Board or the Deputy Governor, SES, as may be applicable, upon recommendation of the appropriate department of SES. "Banks shall ensure compliance with the minimum capital requirements and risk-based capital ratios even after the dividend distribution." "9 3136.2 Limitotions/Amount avoilable lor dividends declared by rurol banks and cooperotive bonks. The following rules shall also govern the declaration of dividends by RBs and Coop Banks. "a. Reserve for retirement of government preferred stock. In addition to the requirements prescribed in Subsec. XL36.2, an RB/Coop Bank may declare cash dividends only if the amount of its reserve for retirement of government preferred stock is at least equal to the amount which should have been accumulated had the bank transferred annually to the reserve account from its undivided profits an amount equal to at least an average of one-tenth (1/10) of the total amount of preferred stock; and "b. Applicability of other laws, rules and regulotions for Coop Banks. Coop Banks shall, likewise, comply with the provisions governing the distribution of net surpfus as provided under Article 86 of R.A. No. 9520, the Coop Bank's By-Laws as well as other laws, rules and regulations. "c. Dividends on government shores for RBs "(Ll Held prior to 09 June 1992. Whenever dividends of not less than fourteen percent (L4o/ol are declared on common stock, government preferred stock shall be entitled to a cash dividend not to exceed two percent (2o/ol of total outstanding preferred stock. Should the dividends declared on common stock be less than fourteen percent (L4o/ol, the dividend on preferred stock shall be proportionately reduced. I Major acts or omissions is defined as bank's individual failure to comply with the requirements of banking laws, rules and regulations as well as Monetary Board directives having material impact on bank's capital, solvency, liquidity or profitability, and/or those violations classified as major offenses under the Report of Examination, except those classified under unsafe or unsound banking practice.

"(2) Held on or after 09 June 1992. shares held by the LBp, DBp, or by any government-owned or-controlled bank or Fl shalt share in dividend distributions from the date of issuance in the amount of four percent (4%l onthe first and second years six percent (60/o) on the third and fourth years; eight percent (g%) on the fifth and sixth years; ten percent (10%) on the seventh and eighth y".rr; and twelve percent (L2o/ol on the ninth to the fifteenth years, which shall be cumulative: Provided, That the RB and the government-owned or controlled bank are not precluded from entering into an agreement providing for rates of dividends other than those prescribed by law. "(3) Held on or after 13 September 2013. Shares held by the LBp, DBp, or.by any government-owned or-controlled bank or Fl shall share in dividend distributions from the date of issuance in an amount based on the lending benchmark approved by the Bangko Sentral plus the prevailing non-prime spread of the government Fl: Provided, That the RB and the government-owned or -controlled bank are not precluded from entering into an agreement providing for rates of dividends other than those prescribed by law.', "SX136.3 Net amount availoble for dividends. The net amount available for dividends shall be the amount of unrestricted or free retained earnings and undivided profits reported in the Financial Reporting package (FRp) as of the calendar/fiscal year-end immediately preceding the date of dividend declaration. "The derivation of the amount of dividends from the unrestrictedfree retained earnings shall be based on a sound accounting system and loss provisioning processes under existing regulations which takes into account relevant capital adjustments including losses, bad debts and unearned profits or income.2 ,. 'S X136.4 Reporting and verificotion. Declaration of dividends shall be reported by the bank concerned to the appropriate'department of the sES within ten (10) banking days after date of declaration in the following manner: "a. submission of a dury notarized certification (Annex A) signed by the President, or an officer of equivalent rank, and the Chief Compliance officer stating that the bank has complied with the requirements on the declaration of dividends provided under Subsec. xLg6.2, and, in the case of rural banks and cooperative banks, subsec. 3L36.2, as well as other existing applicable laws; and "b. Submission of the Report on Dividends Declared (Annex B), which shall be considered a Category A-1 report. Unearned profits or income refers to unrealized items which are considered not available for dividend declaration such as accumulated share/equity in net income of its subsidiaries, associates or joint venture accounted for under the equity method, recognized deferred tax asset, foreign exchange profit arising from revaluation of foreign exchange denominated accounts and others.

"However, banks with major supervisory concerns such as those initiated under prompt corrective action (PCA) or with specific MB directive to suspend/refrain/restrict dividend declaration, shall be subject to prior Bangko Sentral verification by the appropriate department of the SES. Pending verification of abovementioned reports, no announcement or communication on the declaration of dividends nor shall any payment be made thereon until receipt of Bangko Sentral advice thereof." "S X136.5 Recording ol dividends. The liability for dividends declared shall be taken up in the bank's books upon its declaration. "However, for dividend declarations that are subject to prior Bangko Sentral verification, the liability for dividends declared shall be taken up in the bank's books upon receipt of Bangko Sentral advice thereof. A memorandum entry may be made to record the dividend declaration on the date of approval by the board of directors. "For full disclosure purposes, the dividends declared shall be disclosed in the financial statements either as a footnote in the statement of changes in equity or in the notes to the financial statements. For dividends declared that is still subject to prior Bangko Sentral verification, disclosure by means of a footnote should include a statement to the effect that the dividend declaration is subject to review by the Bangko Sentral ." '9 X136.6 lssuance of fractional shares. Whenever the declaration of stock dividend results in the issuance of fractional shares, banks may observe the following guidelines: t'xxxtt "9 X136.7 - X136.9 (Reserued)" "5 X135.10 Superuisory Enforcement Actions. Consistent with Circular No. 875 dated 15 April 2OL5, the Bangko Sentral may deploy enforcement actions to promote adherence with the rules and regulations governing dividend declaration and bring about timely corrective actions. The Bangko Sentral may issue directives to supend/refrain/restrict from performing a particular activity, or impose sanctions to limit the level of or suspend any business activity that has adverse effects on the safety or soundness of the bank, among others. Sanctions may likewise be imposed on a bank and/or its directors, officers and/or employees. "The imposition of sanctions shall be without prejudice to the imposition of administrative sanctions under Section 37 of R.A. No. 7553 including declaring as unsafe or unsound (as defined under Section 56 of R.A. No. 8791) the inappropriate dividend declarations, and/or to the filing of appropriate criminal charges against culpable persons as provided under Section 35 of R.A. No. 7653 for the willful making of a false/misleading statement.

"Further, banks subsequently found to have violated the provisions on dividend declaration or have falsely certified/submitted misleading statements shall be reverted to the prior Bangko Sentral verification wherein the bank can only make an announcement or communication on the declaration of dividends or payment of dividends thereon3 upon receipt of Bangko sentral advice thereof.,, "Sec. X137 (Reserved|,, "Sec. 1137 (Reserved),, " Sec. 2l3l ( Reserved ),, "Sec. 3137 timitations/Amount Available on Dividends Declared by Rural Banks and cooperative Banks. (Deteted by circular No. g8g dated g october 2075) 5 3137.1 Dividends on government shares (Deteted by Circular No. ggg dated 9 October 2015) "Secs. X138 - X140 (Reserved) "g x126.5 lssuance of redeemoble shares: conditions; certificqtion and report; sonctions "a. Conditions. Banks may issue redeemable shares subject to the following conditions: (1) xxx (21 xxx (3) The applicant bank after xxx: (a) xxx (b) xxx (c) xxx (d) No dividend shall be declared or paid on redeemable shares in the absence of sufficient undivided profits, free surplus.,, "xxx." section 2. The following sections/subsections of the M9RNBFI are hereby amended as follows: "sec' 4136Q Poo84126Q) Dlvidends. The following rules and regulations shall govern the declaration of dividends on shares of stock, regardless of feature, as well g subject banks whose shares are listed with any domestic stock exchange may declare dividends and give immediate notice of such declaration to the sEC and the stock exchanges, in compliance with pertinent rules ' of the sEC: Provided, That, no record date is fixed for such dividend pending verification of the report on such declaration by the appropriate department of the SES.

as interest payments on unsecured subordinated debt which meet the qualification requirements of Additional Tier 1 as defined under existing risk-based capital adequacy framework. "Pt)rsuant to Section 57 of R.A. No. 87gL, no QB shall declare dividends greater than its accumulated net profits then on hand, deducting therefrom its losses and bad debts. Neither shall the QB declare dividends if, at the time of decf aration, it has not complied with the provisions of Subsec. 4L36e.2." "g 4136q.1 PW8 - 4126Q.1) Delinitions of terms. For purposes of this Section, the following definitions shall apply: "xxx" '9 4136q.2 e@8 - 4126Q.2) Require'ments on the declarotion of dividends/net amount available for dividends. "a. Requirements on the declarotion of dividends. At the time of declaration, QBs shall have complied with the following: "(1) Clearing account with the BSP is not overdrawn; "(2) Minimum capitalization requirement and risk-based capital ratios as provided under applicable and existing capital adequacy framework; "(3) Capital conservation buffer requirement as defined in Appendix Q-45, Part lll, for QBs that are subsidiaries of universal and commercial banks (U/KBs); "(4) Higher loss absorbency requirement, phased-in starting 1 January 2017 with full implementation by 1 January 2OL9, in accordance with Domestic Systemically lmportant Banks (DSlBs) Framework as provided under Circular No. 856 dated 29 October 20L4, for QBs that are subsidiaries of U/KBs identified as DSIBs; and "(5) Has not committed any unsafe or unsound practice as defined under existing regulations and/or major acts or omissionsa as may be determined by the Bangko Sentral to be ground for suspension of dividend distribution, unless this has been addressed by the QB as confirmed by the Monetary Board or the Deputy Governor, SES, as may be applicable, upon recommendation of the appropriate department of SES. "QBs shall ensure compliance with the minimum capital requirement and risk-based capital ratio even afterthe dividend distribution. a Malor acts or omissions is defined as QB's individual failure to comply with the requirements of banking laws, rules and regulations as well as Monetary Board directives having material impact on QB's capital, solvenry, liquidity or profitability, and/or those violations classified as major offenses under the Report of Examination, except those classified under unsafe or unsound practice.

"b. Amount available. The net amount available for dividends shail be the amount of unrestricted or free retained earnings and undivided profits reported in the Bangko Sentral prudential reports as of the calend ar/fiscal year-end immediately preceding the date of dividend declaration. "The derivation of the amount of dividends from the unrestrictedfree retained earnings shall be based on a sound accounting system and loss provisionlng processes under existing regulations which takes into account retevant capital adjustments including losses, bad debts and unearn'ed profits or income.S.,, "9 4136Q.3 (Reserued)" "5 4136Q'4 PN8 - 4126Q.9) Reporting ond verification. Declaration of cash dividends shall be reported by the eB concerned to the appropriate department of the sES within ten (10) business days after date of declaration in the following manner: "a' Submission of a duly notarized certification (Annex A) by the president, or an officer of equivalent rank, and the Chief Compliance officer stating that the eB has complied with the requirements on the declaration of dividends provided under subsec. 4L36Q.2, as weil as other existing appricabre raws; and 'b' Submission of the Report on Dividends Declared (Annex B), which shall be considered a Category A-1 report. "However, QBs with major supervisory concerns such as prompt corrective action (pcA) or with specific those initiated under MB directive to suspend/refrain/restrict dividend declaration, shall be subject to prior Bangko sentral verification by the appropriate department of the sES. pending verification of abovementioned reports, no announcement or communication on the declaration of cash dividends nor shall any payment be made thereon until receipt of Bangko Sentral advice thereof.,, - "9 4136Q.5 l2Mg 4726Q.41 Recording of dividends. The liability for cash dividends declared shall be taken up in the eg,s boots upon its declaration. "However, for dividend declarations that are subject to prior Bangko Sentral verification, the liability for cash dividends declareo strail be taken up ii th. eB,, books upon receipt of Bangko sentral advice thereof. A memorandum entry may be to record the dividend declaration on the date of approval by the board T"d: orrectors. of unearned profits or income refers to unrealized items which are considered not available for dividend declaration such as accumulated share/equity in net income of its subsidiaries, associates or joint venture accounted for under the equity method, recognized deferred tax asset, foreign exchange profit arising from revaluation of foreign exchange denominated accounts and others.

"For full disclosure purposes, the cash dividends shall be disclosed in the financial statements as a footnote in the statement of changes in equity or in the notes to the financial statements. For dividends declared that is still subject to prior Bangko Sentral verification, disclosure by means of a footnote should include a statement to the effect that the dividend declaration is subject to review by the Bangko Sentral." "g 4136Q.6 (Reserued)" "9 4135q.7 l200g - 4726Q.5) Rules on declaration of stock dividends. The declaration of stock dividends shall be subject to the preceding regulations on declaration of cash dividends. " 'S 4136Q.8 - 4136Q.9 (Reserued)" "9 4136Q.1O Superuisory Enforcement Actions. Consistent with Circular No. 875 dated 15 April 2OL5, the Bangko Sentral may deploy enforcement actions to promote adherence with the rules and regulations governing dividend declaration and bring about timely corrective actions. The Bangko Sentral may issue directives to suspend/refrain/restrict from performing a particular activity, or impose sanctions to limit the level of or suspend any business activity that has adverse effects on the safety or soundness of the QB, among others. Sanctions may likewise be imposed on a QB and/or its directors, officers and/or employees. "The imposition of sanctions shall be without prejudice to the imposition of administrative sanctions under Section 37 of R.A. No. 7553 including declaring as unsafe or unsound (as defined under Section 56 of R.A. No. 8791) the inappropriate dividend declarations, and/or to the filing of appropriate criminal charges against culpable persons as provided under Section 35 of R.A. No. 7653 for the willful making of a false/misleading statement. "Further, QBs subsequently found to have violated the provisions on dividend declaration or have falsely certified/submitted misleading statements shall be reverted to the prior Bangko Sentral verification wherein the QB can only make an announcement or communication on the declaration of dividends or payment of dividends thereon6 upon receipt of Bangko Sentral advice thereof." Section 3. The Financial Reporting Package, prescribed under Subsection XL9t.2 of the MORB is further amended to revise the Manual of Accounts (MOA) to amend the definition of Dividends Payable as follows: (a) Manualof Accounts "xxx 6 Subject QBs whose shares are listed with any domestic stock exchange may declare dividends and give immediate notice of such declaration to the SEC and the stock exchanges, in compliance with pertinent rules of the SEC: Provided, That, no record date is fixed for such dividend pending verification of the report on such declaration by the appropriate department of the SES.

"30. Other Liabilities "(al Servicing Liabitities _ xxx "xxx (e) Dividends payable - This refers to the amount of unpaid cash dividends decrared by the Board of Directors to stockholders of record. "xxx Section 4. Appendix 6 of the MORB and Appendix e-3 of the MORNBFT are hereby amended to include the Report on Dividends Declared (for bank and eBs) as a category A-1 report which shall be submitted within 10 banking/business days after date of dividend decraration to the appropriate department of the sEs. This circular shall take effect fifteen (15) days after its publication either in the official Gazette or in a newspaper of general circulation. FOR THE MONETARY BOARD: C. GUINIGUNDO q October 2015

Annex A FORMAT CERTIFICATION ON COMPTIANCE WITH REQUIREMENTS ON DIVIDEND DECTARATION (Appendix to Subsec. XL36.4l 486q.4l (Name of Bank/QB) CERTIFICATION We, Name of Officer), President br Officer of Equivalent RanH and (Nome of Officerl. Chief Compfiance Officer, in behalf of (Name of Bank/Qil, with office address at Heod/Principal Officet. after having been duly sworn to in accordance with law, hereby certify that the bank's/QB's dividend declaration as of (date of dividend decloration), as approved by the board of directors (state resolution number and dotd, to the bank's/QB's stockholders of record as of (record dote) amounting to.{amount of cash/stock/propertv dividend decloration) complies with the provisions of Section X135 of the Manual of Regulation for Banks (MORB), in the case of banks, or Section 4136Q of the Manual of Regulations for Non-Bank Financial lnstitutions, in the case of QBs. We further certify that at the time of dividend declaration, the bank/QB has complied with the following: a. Clearing account with the Bangko Sentral is not overdrawn; b. Liquidity floor requirement for government funds; (for bonks) c. Minimum capitalization requirement and risk-based capital ratios as provided under applicable and existing capital adequacy framework;1 d. Capital conservation buffer requirement as defined in Appendix 63b/Q-46, Part llf of the MORBIMORNBFI; (for U/KBs and their subsidiary bonks and QBs) e. Higher loss absorbency requirement as provided under Circular No. 856 dated 29 October 2Ot4; (for identified Domestic Systemicolly lmportant Bonks and their subsidiory bonks and QBs) f. Has not committed any unsafe or unsound banking practice and/or major acts or omissions as as may be determined by the Bangko Sentral; g. Has accumulated reserves of P for the retirement of the government preferred stock which is at least equal to the amount prescribed in Subsection 3136.2 of the MORB (for rurol ond cooperative bonks); h. Has complied with the provisions of Article 86 of R.A. No. 9520, its By-Laws and other applicable laws, rules and regulations on the allocation and distribution of net surplus (for cooperotive bonks); 1 We also certify that the bank/quasi-bank also comply with this requirement even after dividend distribution.

i. Has complied with the provisions of Section 43 (Power to declare dividends) of The corporation code of the philippines (Batas pambansa Blg. 6g), as may be applicable; and j' Has complied with the provisions of revised implementing rules and regulations to R'A. No. 7556, "An Act Requiring Government-Owned and/or Controlled Corporations to Declare Dividends Under Certain Conditions to the National Government, and for other purposes" (for Government-owned banks/eBs) To the best of our knowledge, the foregoing statements are true and correct. president Chief Compliance Officer TIN: TIN: Com. Tax Cert. No.: Com. Tax Cert. No.: lssued on: lssued on: lssued at: lssued at: Subscribed and sworn to before me, this exhibiting his/her respective Community Tax Certificate aiindicated above. NOTARY PUBLIC Doc. No. Page No. Book No. Series of :

ANNEX B Category: CategoryA-1 Deadline: 10 banking/business days after date of dividend declaration Submission: Hard copy to the appropriate supervising department of the SES FOR ALL 8ANKS/QBs Name of Bank/QB Code Address REPORT ON DIVIDENDS DECIARED As of ( Date of Dividend Declaration) REPUBLIC OF THE PHILIPPINES) ) s.s. We solemnly swear that all matters set forth in this report including its supporting schedule are true and correct, to the best of our knowledge and belief. (Signature of Chief Compliance Officer) (Signature of Chief Finance Officer/ Comptroller/Chief Accountant) (Signatu re of President/Senior/ Executive Vice President) SUBSCRIBED AND SWORN TO BEFORE ME this day of 20- affiants exhibiting to me their Valid lD No., to wit: Name Valid lD No. Date/Place lssued Notary Public Until PTR No. Place Doc. No. Page No. Book No, Series of

&t.dulc REFONT Oil DIVIDENDS DECI.ARED IIAME Of UB/X8/TB/RB/QB (DoE ol dividend deldfttion) 1. DcdanffmbrythaSorrdofDtrcctoE Minutes No: Roslution No: M€.ting: Dat of M.etin3: (spelol or regular) Z srrmm.ry: .. Date of Doclantion ofDtuidands: b. Reord D.te: c. Divid.nd Paymcnt Dat€ d. Form of Divad.nds (Cosh. Stock, etc.): 3. DlstdbudonotDtvtd.nds: SluEs Entid.d to Dlvldcnd3 Dlvld.ndr H.rcd C.sh Stodt OtrcrPrcpcfi Sharc O.s/ No. of Amunt u lse Preparty slrarcs v Rate pca Tobl Rrte pa? Total Rate par Totd Deslptlon valc Sh.rc Anount Sh!rc Prle Ameunt ShaG Amou.rt ,clerred v lhis includos inteEst pald for unecur.d subordin.t.d dabt that qu.lity .s Addlilonal Ti.. 1 o. Hyb.id Ttlr 1 Gpital U Numbcr of shares of subsribed @ptt.tstak as ot Ecord d.tc { Grrying amount ofsubscribed c.plt.l st6k a5 of r.cord datc '/ lsue prle ofstock dtvtdend (per sharc) 5/ Falr value of property (per unit)

Schedule 2 REPORT ON DIVIDENDS DECTARED NAME OF UB/KB/TB/RB/QB Computation of Net Amount Available for Dividends As of (Date of dividend declaration) fffmf1fi$ridfJ;i'fll"1.,'$r,, ,r:lird$ 4' ::S i;l:ii,:,til ,ri l"i'it,+:,;,r:'l' l':::i ,'jf*l"i ,firirlif*l l, A. Basis for Computation of Dividends (As of calendar/Iiscol yeor-end immediately preceding the date of decloration) Retained Earnings Free xxx Undivided Profits xxx B. Less: Ca pital Adjustments: (pleose spectfy) C. Net amount available for dividends* xxx D. Amount of Dividends Declared xxx E. Excess/{oeficiency) in Net Amount Available for Dividend Declaration xxx *The net amount avoiloble for dividend declaration sholl be bosed on the unrestricted retoined eornings ond undivided profits which shall be bosed on a sound accounting system ond loss provisioning processes that considers relevont adjustments to capital including /osses, bad debts and uneorned profits or income.

NEFORT ON DIVIOENDS DECI.ARED NAME OF COOP EANK (Dote d dlvldend declomtion) Dcdar.tbn by th. f€rd ot Dlr.ctoE Mlnutes No: Resolution No: Meeting: Date of Meetingr (spaiol or rcEulor, 2. Sunnary: Date ofDecla6tion of Dividends: R€@.d D.te: - Dividend Payfrcnt D.te Form ofDlvidends fcash, St@k, etc.): 3. DhtrlbutlonofDivtdands: ', Number of shares of subscrlbed capital stock as of rccord date - Carryln8 amount of $b$ribed capital stal as of r6ord date v lsse pri@ ofstock dtvidend (p€r share) v Fairwlue of property (per unit)

Schedule 2 REPORT ON DIVIDEf{DS DECI.ARED NAME OF COOP BANK Computataon of Net Surplus Avallable for DiVidends As of- (Dote oI dividend declorotion) Basis for Computation of Divldends (As ol colendor/fiscal yeor-end immedlately precedlng the dote of decloration) Net Surplus (1) Retained Earnings [ess: Requlred Rese]ves (1) Requlred Reserues under Artlcle 85 of R.A. No. 9520 (al Reserve Fund (b) Education and Training Fund (c) Community Development Fund (d) Optional Fund (2) Other Requlred Reserves (a) Trust Business (b) Self Insurance (c) Contingencies (d) Redemption of Preferred Shares ofStock Net Surplus Avallable for Dividend Declaration* Amount of Dividends Declared (1) Interest on Share Capital (21 Patronage Refund Excess/(Deficiency) in Net Surplus Avallable for Dividend Declaration *The net omount availoble for dividend declorotion sholl be bosed on the unrestricted retoined earnings and undivided proftts which sholl be bosed on o sound accounting system ond loss provisioning processes thot considers relevant adiustments to copitol ncluding losses, bod debts and uneorned profits or income.